> Ahahahah! Good one, maybe next time [exaggerating your expression like if this was definitely a joke]. So, do you like extra dark chocolate or milk is better? 

In other words, **dodge the proposal**. It's so out of every social norm that you don't even need to think that they were serious. It was a daring proposal of them, as Bob's reaction underlines (not a clear "yes let's do it"). Let them know that they are alone on this. 

Also, it's easy to push somebody to do something uncomfortable, less easy to do it:

> Oh nice one Alice, you go first and I'll follow, OK? 

This is a good way to deflate the situation (assuming Alice wouldn't give her consent to random fondling), it puts Alice in your shoes, even if jokingly. 

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<sub> Not-so-on-topic reflection : Hadn't I known the age of the three people involved in the situation, I'd have though of some clumsy and teenage-y manoeuvre of Alice and John to get you and Bob closer. Might it be that he likes you and Alice and John know it? </sub>